Shares of CE Info Systems (MapmyIndia) witnessed a significant decline of 10% over the last two trading sessions, closing at ₹1,589.05 on December 3, 2024. The stock registered a 3.60% drop on December 2, followed by a steeper fall of 5.94% today. This sharp decline comes after the company announced its involvement in a new business-to-consumer (B2C) venture initiated by Rohan Verma, the former CEO and Executive Director.
Key Developments:
- Stake Acquisition: MapmyIndia will acquire a 10% stake in the new B2C company floated by Rohan Verma.
- Funding Commitment: The company will invest ₹35 crore via compulsorily convertible debentures (CCDs). These CCDs will convert into equity either after 10 years or at a 25% discount to any third-party valuation of the new entity, whichever is earlier.
- Leadership Changes: Rohan Verma will step down as CEO and Executive Director to become a Non-Executive Director of MapmyIndia, effective April 1, 2025.
- Promoter Clarification: Founders Rakesh Verma and Rashmi Verma clarified they would not participate in the new entity and remain fully committed to MapmyIndia’s growth trajectory.
The new entity will focus exclusively on the B2C segment, aiming to complement MapmyIndia’s existing B2B and B2B2C operations. MapmyIndia has clarified that all operational expenses, including marketing, personnel, and cloud costs, will be independently managed by the new entity, ensuring no direct financial burden on the parent company. While MapmyIndia has emphasized the complementary nature of the initiative, uncertainties remain about the funding commitment’s implications and the potential impact on the company’s financial health.
MapmyIndia has reaffirmed its commitment to its core B2B and B2B2C operations, which continue to exhibit a strong growth trajectory and profitability. The company remains a market leader in these segments, addressing a large and expanding market effectively.
